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End of an Era for PDI as DreamWorks Animation Closes Studio

Facility could have used a hit like Oscar-nominated and Golden Globe winner 'How to Train Your Dragon 2'

It’s a bittersweet moment to be at PDI/DreamWorks.

Just after celebrating DWA’s Golden Globe win and an Oscar nomination for “How to Train Your Dragon 2,” the Redwood City, Calif.-based animation studio that DreamWorks Animation acquired in 2000 is being shut down as part of a major reorganization by its parent company after a string of box office disappointments have taken a creative and financial toll.

PDI, which was founded by Carl Rosendahl in 1980 as Pacific Data Images, started as a visual effects studio, producing computer-generated graphics for broadcast networks, TV shows and commercials before working on films such as “Batman Forever,” “The Arrival,” “Terminator 2,” “Toys” and “Angels in the Outfield.”

It later expanded into feature animation, with its first DWA collaboration, 1998’s “Antz,” launching Katzenberg’s toon studio. “Shrek” soon followed in 2001, also produced by PDI, which went on to win the Oscar for best animated feature in 2002.

DreamWorks acquired a 40% stake in PDI in 1996, to produce animated films, and the rest of the firm in 2000 for an undisclosed price, renaming it PDI/DreamWorks.

After hits like “Shrek” and “Madagascar 3,” it stumbled more recently with “Mr. Peabody & Sherman” and “The Penguins of Madagascar.” Both have led to significant losses for DWA.

While it did some work on the “How to Train Your Dragon” franchise, it wasn’t the lead animation house on the films, including last year’s sequel directed by Dean DeBlois. The film, whose production largely took place at DWA’s Glendale campus, made history for DWA this month, becoming the company’s first toon to win the Globe for best animated feature, after six previous nominations, and is now considered a frontrunner for the Oscar in the same category.

Instead, PDI will mostly be left with two misfires as a last hurrah for a company that is about to lose half of its workforce of 450 employees. Some of the remaining staff will be offered positions at DWA’s Glendale studio.

The facility is expected to shutter at the end of the year as part of an effort to save DWA $30 million in 2015, and $60 million by 2017.

DWA is slashing over 500 jobs at its studio overall, primarily on the film side, representing 18% of the company’s workforce.

“The No. 1 priority for DreamWorks Animation’s core film business is to deliver consistent creative and financial success,” Katzenberg said. “I am confident that this strategic plan will deliver great films, better box office results and growing profitability across our complementary businesses.”

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